We investigate the effects of Er2O3 on electrical properties of the SnO2·CoO· Ta2 O5 varistor system sintered at 1400 ℃. It is found that all the samples have excellent nonlinear electrical characteristics and the sample with 0.50mol% Er2O3 has the best nonlinear electrical property and the highest nonlinear coefficient (α = 43.7). The high nonlinear coefficient value obtained in the system indicates that the SnO2-based varistor is a candidate for ZnO-based varistors in commercial applications. Er2O3 additive can significantly affect the average grain size. With increasing Er2O3 concentration from 0. 10mol% to 1.00mol%, the average grain size decreases from 21.2μm to 10. 6μm, the breakdown electrical field increases from 208 V/mm to 459V/mm, and the relative electrical permittivity decreases from 2440 to 1210. The reason that the grain size decreases with increasing Er2 O3 concentration is explained. Also, we present a modified defect barrier model to illustrate the grainboundary barrier formation of Er2 O3-doped SnO2 based varistors.